Home Money Home insurance prices up 13% in a year – here’s how to cut cover costs

Home insurance prices up 13% in a year – here’s how to cut cover costs

by Elijah
0 comment
Rising premiums: Home coverage prices are rising, although insurers argue they are keeping costs down as much as they can to help struggling homeowners.
  • Home coverage price rises, partly due to bad winter weather
  • But homeowners still face smaller premium increases than unlucky drivers.

Home insurance prices rose by an average of 13 per cent to £341 a year, according to insurer figures.

The average buildings-only insurance policy was £262 at the end of 2023, an increase of 15 per cent, according to trade body the Association of British Insurers (ABI).

Over the last year, the average content-only premium has risen 7 per cent to £124.

The ABI said home insurance premiums were rising partly due to the winter storms that hit the UK.

Rising premiums: Home coverage prices are rising, although insurers argue they are keeping costs down as much as they can to help struggling homeowners.

Insurers paid out £352 million in claims for storms Babet, Ciaran and Debi.

A winter cold snap also caused a wave of claims for burst water pipes, which insurers are still sorting out.

Louise Clark, policy adviser at ABI, said: “The succession of storms that have hit the UK in recent months underlines the importance of home insurance, as insurers support thousands of customers whose homes and possessions have been damaged. damaged or destroyed.”

“Despite increasing cost pressures, insurers are fully committed to doing everything possible to continue offering home insurance at competitive prices.”

The ABI figures cover premiums paid by 16 million policyholders, representing around half of all UK households.

The trade body insisted the average home insurance premium had fallen between 2014 and 2023 when adjusted for inflation.

Increases in home insurance costs are also dwarfed by the scale of premium increases in motor insurance.

Car insurance costs rose 29 per cent in 2023 to a record average of £561 a year.

How to save money on home insurance

Pay annually, not monthly

You can reduce your premium by paying for your home insurance in one lump sum each year.

If you pay monthly, you are actually getting a loan for the full annual amount and you will usually be charged interest.

Interest could amount to the equivalent of up to 40 per cent of your annual premium, according to comparison website Uswitch.

Raise your excess

When you make an insurance claim, you usually have to cover the first part (known as the deductible) and your insurer takes care of the rest.

However, to reduce your premiums, you can voluntarily increase the excess, meaning that if you claim, you will have to pay more yourself.

For example, increasing your excess from zero to £400 could reduce your premium by 25 per cent.

However, make sure you can afford the excess in the event of a claim.

Reconsider any plugin

Insurers often give you the option of adding extras to your policy, including emergency coverage. Consider whether you really need these plugins.

Home emergency protection can add around £40 to your annual insurance bill, while accidental damage protection can increase your premium by around 10 per cent.

Check with your bank to make sure you’re not duplicating, as some accounts may include these extras.

For example, Lloyds Bank’s Premier account offers home emergency cover.

Shopping around

Although insurance prices are increasing, shopping around is still the best way to ensure you get the best price.

Use more than one price comparison website to ensure you get a good variety of quotes.

But don’t buy insurance based on price alone. Cheaper policies may exclude coverage you really want or need, so be sure to read the fine print on any policy.

You may also like